<PAGE> 1
FORM 10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarter ended JUNE 30, 1995 Commission file number: 0-16641
RAINBOW TECHNOLOGIES, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 95-3745398
(State of Incorporation) (I.R.S. Employer Identification No.)
50 TECHNOLOGY DRIVE, IRVINE, CALIFORNIA 92718
(Address of principal executive offices) (Zip Code)
(714) 450-7300
Indicate by check mark whether the Registrant (i) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (ii) has been subject to
such filing requirements for the past 90 days.
Yes X No_____.
---
The number of shares of common stock, $.001 par value, outstanding as of June
30, 1995 was 7,272,586.
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RAINBOW TECHNOLOGIES, INC.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
PART I - FINANCIAL INFORMATION
Item 1. Condensed Consolidated Balance Sheets at
June 30, 1995 and December 31, 1994. 3
Condensed Consolidated Statements of Income
for the Three and Six Months ended June 30, 1995
and 1994. 4
Condensed Consolidated Statements of Cash Flows
for the Three and Six Months ended June 30, 1995 and 1994. 5
Notes to Condensed Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
PART II - OTHER INFORMATION
Item 1 to 5 - Not applicable
Item 6. Exhibits and Reports on Form 8-K 12
SIGNATURES 13
</TABLE>
2
<PAGE> 3
RAINBOW TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
A S S E T S
<TABLE>
<CAPTION>
June 30, December 31,
1995 1994
(unaudited)
------------ ------------
<S> <C> <C>
Current assets:
Cash and cash equivalents.......................................................... $ 22,709,000 $ 19,755,000
Marketable securities available for sale........................................... 7,880,000 3,592,000
Accounts receivable (less allowance for doubtful accounts
of $342,000 and $368,000 in 1995 and 1994, respectively)......................... 10,127,000 10,337,000
Note receivable.................................................................... 3,000,000 3,000,000
Inventories ....................................................................... 1,972,000 2,862,000
Unbilled costs and fees............................................................ 3,300,000 2,895,000
Prepaid expenses and other current assets.......................................... 1,699,000 1,878,000
------------- -------------
Total current assets.......................................................... 50,687,000 44,319,000
Property, plant and equipment, at cost:
Buildings.......................................................................... 9,707,000 8,889,000
Furniture.......................................................................... 752,000 750,000
Equipment.......................................................................... 3,967,000 3,322,000
Leasehold improvements............................................................. 205,000 494,000
------------- -------------
14,631,000 13,455,000
Less accumulated depreciation and amortization..................................... 3,654,000 3,586,000
------------- -------------
Net property, plant and equipment............................................. 10,977,000 9,869,000
Goodwill, net of accumulated amortization of $5,743,000 and
$4,380,000 in 1995 and 1994, respectively.......................................... 7,201,000 7,425,000
Other assets, net of accumulated amortization of $903,000
and $627,000 in 1995 and 1994, respectively ....................................... 3,195,000 3,254,000
------------- -------------
$ 72,060,000 $ 64,867,000
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable................................................................... $ 2,598,000 $ 2,098,000
Accrued payroll and related expenses............................................... 1,878,000 2,451,000
Other accrued liabilities.......................................................... 931,000 671,000
Income taxes payable............................................................... 762,000 402,000
Billings in excess of costs and fees............................................... 13,000 422,000
Long-term debt, due within one year................................................ 320,000 364,000
------------- -------------
Total current liabilities..................................................... 6,502,000 6,408,000
Long-term debt, net of current portion............................................... 2,809,000 2,695,000
Deferred income taxes ............................................................... 2,337,000 1,441,000
Shareholders' equity:
Common stock, $.001 par value, 20,000,000 shares authorized,
7,272,586 and 7,223,946 shares issued and outstanding
in 1995 and 1994, respectively (note 5).......................................... 7,000 7,000
Additional paid-in capital......................................................... 28,781,000 28,222,000
Cumulative translation adjustment.................................................. 652,000 (465,000)
Retained earnings.................................................................. 30,972,000 26,559,000
------------- -------------
Total shareholders' equity.................................................... 60,412,000 54,323,000
------------- -------------
$ 72,060,000 $ 64,867,000
============= =============
</TABLE>
See accompanying notes.
3
<PAGE> 4
RAINBOW TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, 1995 June 30, 1994 June 30, 1995 June 30, 1994
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Revenues:
Sales................................................ $ 10,570,000 $ 9,279,000 $ 21,232,000 $ 18,302,000
Contracts............................................ 6,091,000 5,181,000 11,182,000 8,914,000
------------- ------------- ------------- -------------
Total revenues.................................. 16,661,000 14,460,000 32,414,000 27,216,000
Cost of revenues:
Cost of sales........................................ 3,096,000 2,744,000 6,143,000 5,138,000
Cost of contracts.................................... 3,860,000 3,374,000 6,840,000 6,055,000
------------- ------------- ------------- -------------
Total cost of revenues.......................... 6,956,000 6,118,000 12,983,000 11,193,000
------------- ------------- ------------- -------------
Gross profit......................................... 9,705,000 8,342,000 19,431,000 16,023,000
Operating expenses:
Selling, general and administrative.................. 3,705,000 2,990,000 7,352,000 5,830,000
Research and development............................. 1,942,000 1,939,000 3,965,000 3,605,000
Goodwill amortization................................ 464,000 412,000 904,000 809,000
------------- ------------- ------------- -------------
Total operating expenses........................ 6,111,000 5,341,000 12,221,000 10,244,000
------------- ------------- ------------- -------------
Operating income....................................... 3,594,000 3,001,000 7,210,000 5,779,000
Interest income........................................ 416,000 168,000 719,000 297,000
Interest expense....................................... (104,000) (95,000) (204,000) (194,000)
Foreign currency gains (losses)........................ 7,000 (450,000) (239,000) (490,000)
------------- ------------- ------------- -------------
Income before provision for income taxes............... 3,913,000 2,624,000 7,486,000 5,392,000
Provision for income taxes ............................ 1,656,000 1,032,000 3,073,000 2,139,000
------------- ------------- ------------- -------------
Net income............................................. $ 2,257,000 $ 1,592,000 $ 4,413,000 $ 3,253,000
============= ============= ============= =============
Net income per common and common
equivalent share .................................... $ 0.30 $ 0.22 $ 0.58 $ 0.44
============= ============= ============= =============
Weighted average common and common
equivalent shares outstanding........................ 7,639,000 7,389,000 7,586,000 7,446,000
============= ============= ============= =============
</TABLE>
See accompanying notes.
4
<PAGE> 5
RAINBOW TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
Six months ended Six months ended
June 30, 1995 June 30, 1994
---------------- ----------------
<S> <C> <C>
Cash flows from operating activities:
Net income.................................................................. $ 4,413,000 $ 3,253,000
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization............................................. 1,798,000 1,511,000
Change in deferred income taxes........................................... 764,000 59,000
Allowance for doubtful accounts........................................... (36,000) (93,000)
Changes in operating assets and liabilities:
Accounts receivable..................................................... 481,000 61,000
Inventories............................................................. 945,000 (349,000)
Unbilled costs and fees................................................. (405,000) (701,000)
Prepaid expenses and other current assets............................. 174,000 137,000
Accounts payable........................................................ (212,000) 592,000
Accrued liabilities..................................................... (115,000) (100,000)
Taxes based on income................................................... 422,000 91,000
------------ ------------
Net cash provided by operating activities............................. 8,229,000 4,461,000
Cash flows from investing activities:
Purchase of marketable securities........................................... (4,373,000) (5,824,000)
Sale of marketable securities............................................... 85,000 3,660,000
Purchases of property, plant, and equipment................................. (949,000) (310,000)
Acquisition of AND Group, Inc............................................... -- (1,548,000)
Other long-term assets...................................................... (203,000) --
------------ ------------
Net cash used in investing activities................................. (5,440,000) (4,022,000)
Cash flows from financing activities:
Exercise of common stock options............................................ 559,000 254,000
Payment of long-term debt................................................... (201,000) (255,000)
Principal payment of capital lease.......................................... (19,000) (27,000)
Repurchase of Mykotronx common stock........................................ -- (106,000)
Distribution of Mykotronx S Corporation earnings -- (268,000)
------------ ------------
Net cash (used in) provided by financing activities................... 339,000 (402,000)
Effect of exchange rate changes on cash....................................... (174,000) 438,000
------------ ------------
Net increase in cash and cash equivalents..................................... 2,954,000 475,000
Cash and cash equivalents at beginning of period.............................. 19,755,000 12,936,000
------------ ------------
Cash and cash equivalents at end of period.................................... $ 22,709,000 $ 3,411,000
============ ============
Supplemental disclosure of cash flow information:
Income taxes paid........................................................... $ 2,418,000 $ 2,432,000
Interest paid............................................................... 191,000 234,000
</TABLE>
See accompanying notes
5
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RAINBOW TECHNOLOGIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1995
(UNAUDITED)
1. BASIS OF PRESENTATION
The accompanying financial statements consolidate the accounts of the Company
and its wholly-owned subsidiaries and have been restated for all periods
presented to reflect the acquisition of Mykotronx which has been accounted for
using the pooling of interests method (Note 5). All significant inter-company
accounts and transactions have been eliminated.
In the opinion of the Company's management, the accompanying condensed
consolidated financial statements include all adjustments, consisting only of
normal recurring adjustments, necessary for a fair presentation of the
financial position at June 30, 1995 and results of operations for the three and
six months ended June 30, 1995 and 1994, and cash flows for the three and six
months ended June 30, 1995 and 1994. The condensed consolidated financial
statements do not include footnotes and certain financial information normally
presented annually under generally accepted accounting principles and,
therefore, should be read in conjunction with the Company's December 31, 1994
Annual Report on Form 10-K and it's registration statement on Form S-4 that
became effective on April 24, 1995. Results of operations for the three and
six months ended June 30, 1995 are not necessarily indicative of results to be
expected for the full year.
For research and development and other cost-plus-fee-type contracts, the
Company recognizes contract earnings using the percentage- of-completion
method. The estimated contract earnings are recognized based on percentage of
completion as determined by the cost- to-cost basis whereby revenues are
recognized ratably as contract costs are incurred. For catalog product sales
and certain fixed price contracts calling for delivery of a specific number of
product units, the Company recognizes revenues as units are shipped provided
that no significant vendor obligations remain.
Software development costs incurred subsequent to the determination of
technological feasibility and marketability of a software product are
capitalized. Amortization of capitalized software costs commences when the
products are available for general release to customers. Amortization is
computed on an individual product basis and is based on the product's estimated
economic life.
The Company has subsidiaries in the United Kingdom, Germany, France and Canada.
The Company utilizes the currencies of the countries where its foreign
subsidiaries operate as the functional currency. In accordance with Statement
of Financial Accounting Standards No. 52, the balance sheets of the Company's
foreign subsidiaries are translated into U.S. dollars at the exchange rates at
the respective dates. The income statements of those subsidiaries are
translated into U.S. dollars at the weighted average exchange rates for the
respective periods presented.
2. EARNINGS PER SHARE
Earnings per share are based on the weighted average number of common and
common equivalent shares outstanding during each period. Common equivalent
shares include the potential dilution from the exercise of stock options.
6
<PAGE> 7
3. GOVERNMENT CONTRACTS
The Company is both a prime contractor and subcontractor under fixed-price and
cost-plus-fixed-fee contracts with the U.S. Government (Government). Such
contracts represent over 90% of the Company's contract operations. At the
commencement of each contract or contract modification, the Company submits
pricing proposals to the Government to establish indirect cost rates applicable
to such contracts. These rates, after audit and approval by the Government,
are used to settle costs on contracts completed during the previous fiscal
year.
To facilitate interim billings during the performance of its contracts, the
Company establishes provisional billing rates, which are used in recognizing
contract revenue and contract accounts receivable amounts in these financial
statements. These provisional billing rates are adjusted to actual at year-end
and are subject to adjustment after Government audit.
The Company has unbilled costs and fees at June 30, 1995 of $3,300,000. Based
on the Company's experience with similar contracts in recent years, the
unbilled costs and fees are expected to be collected within one year.
4. INVENTORY
Inventoried costs relating to long-term contracts are stated at the actual
production cost, including pro rata allocations of factory overhead and general
and administrative costs, incurred to date reduced by amounts identified with
revenue recognized on units delivered. The costs attributed to units delivered
under such long-term contracts are based on the estimated average cost of all
units expected to be produced.
Inventory other than inventoried costs relating to long term contracts, are
stated at the lower of cost (principally determined on a first-in first-out
basis), or market (net realizable value) and consist of the following:
<TABLE>
<CAPTION>
June 30, 1995 December 31, 1994
------------- ------------------
<S> <C> <C>
Raw materials $ 467,000 $ 490,000
Work in process 308,000 318,000
Finished goods 936,000 1,391,000
Long term contracts 261,000 663,000
------- -------
$1,972,000 $2,862,000
========== ==========
</TABLE>
5. ACQUISITIONS.
On June 1, 1995, the Company and Mykotronx, Inc. completed the merger of the
two companies. Mykotronx, a California corporation with headquarters in
Torrance, California, designs, develops and manufactures information security
products to provide privacy and security for voice communication and data
transmission. Shareholders of Mykotronx received 2.64 shares of Rainbow
Technologies, Inc. common stock for each share of issued and outstanding
Mykotronx common stock, and Mykotronx became a wholly-owned subsidiary of
Rainbow Technologies, Inc. Accordingly, the Company issued 1,650,000 shares of
its common stock to Mykotronx shareholders in exchange for Mykotronx shares.
In addition, 195,096 shares of Rainbow common stock were reserved for issuance
upon the exercise of assumed Mykotronx Options. The merger
7
<PAGE> 8
was accounted for as a pooling of interests. Expenses associated with the
merger of approximately $170,000 and $350,000, respectively, were included in
the consolidated results of operations for the three and six months ended June
30, 1995.
Revenues and net income derived from Mykotronx operations (effective June 1,
1995) which are included in the accompanying condensed consolidated results of
operations were as follows:
FOR THE THREE MONTHS ENDED JUNE 30, 1995:
<TABLE>
<S> <C>
Revenues $4,571,000
Net Income 659,000
FOR THE SIX MONTHS ENDED JUNE 30, 1995:
Revenues $9,663,000
Net Income 1,278,000
FOR THE THREE MONTHS ENDED JUNE 30, 1994:
Revenues $5,181,000
Net Income 501,000
FOR THE SIX MONTHS ENDED JUNE 30, 1994:
Revenues $8,914,000
Net Income 764,000
</TABLE>
In January 1994, the Company purchased the assets of the AND Group Inc., a
Canadian corporation, in exchange for the sum of $1.5 million U.S. As a
result, the Company acquired all of the intellectual property rights to a
software product, and extinguished all previously existing obligations to pay
royalties to the AND Group, Inc. The acquisition was accounted for as a
purchase. Results of operations for the AND Group, Inc. are included in the
statements of income from the date of acquisition.
8
<PAGE> 9
RAINBOW TECHNOLOGIES, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following is management's discussion and analysis of certain significant
factors which have affected earnings and the financial position of the Company
during the period included in the accompanying financial statements. This
discussion reflects the acquisition of Mykotronx, Inc. and represents the three
and six months ended June 30, 1995, compared with the three and six months
ended June 30, 1994. This discussion should be read in conjunction with the
related condensed consolidated financial statements and associated notes.
Prior period financial statements have been restated to reflect the acquisition
of Mykotronx, Inc., using the pooling of interests method.
RESULTS OF OPERATIONS
<TABLE>
<CAPTION>
Rainbow Mykotronx Combined
------- --------- --------
<S> <C> <C> <C>
For the quarter ended June 30, 1995
Revenues $10,570,000 $ 6,091,000 $16,661,000
Gross Margin 7,475,000 2,230,000 9,705,000
Operating Income 2,421,000 1,173,000 3,594,000
For the quarter ended June 30, 1994
Revenues 9,279,000 5,181,000 14,460,000
Gross Margin 6,535,000 1,807,000 8,342,000
Operating Income 2,167,000 834,000 3,001,000
For the six months ended June 30, 1995
Revenues 21,232,000 11,182,000 32,414,000
Gross Margin 15,089,000 4,342,000 19,431,000
Operating Income 5,002,000 2,208,000 7,210,000
For the six months ended June 30, 1994
Revenues 18,302,000 8,914,000 27,216,000
Gross Margin 13,164,000 2,859,000 16,023,000
Operating Income 4,509,000 1,270,000 5,779,000
</TABLE>
9
<PAGE> 10
SALES
Net sales for the three and six months ended June 30, 1995 increased 14% and
16%, respectively, when compared to the corresponding 1994 periods. The
increases for the periods were primarily due to higher sales in Europe and
North America. Net sales for the three and six months ended June 30, 1995
increased 7% and 8%, respectively, in the United States and increased 26% and
30%, respectively, internationally, when compared to the corresponding 1994
periods. The average selling price per product decreased by approximately 3%
and 4%, respectively, worldwide for the three and six months ended June 30,
1995, when compared to the same periods in 1994. This was primarily due to the
Company's efforts to increase its market share. Unit volume for the three and
six months ended June 30, 1995 was up 17% and 22%, respectively, when compared
to the corresponding 1994 periods.
Contract revenues for the three and six months ended June 30, 1995 increased
18% and 25%, respectively, when compared to the 1994 periods. The increases
for the periods were primarily due to higher revenues from Systems and Software
contracts.
GROSS PROFIT
Gross profit on sales revenues for the three and six months ended June 30,
1995, was 71%, respectively, when compared to 70% and 72%, respectively,
experienced in the corresponding 1994 periods. The increase in gross margin
for the three months ended June 30, 1995 was primarily due to increased sales
in Europe with corresponding higher margins. The decrease in gross margin for
the six months ended June 30, 1995 was primarily due to a change in product mix
to lower margin products.
Gross profit on contract revenues for the three and six months ended June 30,
1995 was 37% and 39%, respectively, when compared to 35% and 32%,
respectively, experienced in the corresponding 1994 periods. The increases in
gross margin for the three and six months ended June 30, 1995 were primarily
due to increased sales in higher end encryption products (higher prices and
margins) to the U.S. government.
SELLING, GENERAL AND ADMINISTRATIVE
Selling, general and administrative expenses for the three and six months ended
June 30, 1995, increased by 24% and 26% when compared to the corresponding 1994
periods. The increases during the three and six months ended June 30, 1995
were due to acquisition expenses ($170,000 and $350,000, respectively) incurred
in connection with Mykotronx, additional staffing, increased professional
expenses and higher sales compensation due to increased sales.
RESEARCH AND DEVELOPMENT
Total research and development expenses for the six months ended June 30, 1995
increased 10% when compared to the corresponding 1994 period. The increase was
primarily due to the addition of engineering staff. Current research and
development activities are focused on additional Application Specific
Integrated Circuits development for future products and adaptation of the
Company's products to additional software operating environments and computer
platforms.
10
<PAGE> 11
OTHER INCOME (EXPENSE)
Interest income for the three and six months ended June 30, 1995 increased by
148% and 142% to $416,000 and $719,000, respectively, because of higher
investment balances.
During the six months ended June 30, 1995, the Company incurred predominantly
unrealized foreign currency losses of $239,000, primarily due to dollar
denominated deposit accounts maintained in Europe. During the six months ended
June 30, 1994, the Company recognized foreign currency losses of $490,000, also
primarily due to dollar denominated deposit accounts maintained in Europe.
Such foreign currency losses result from the movement of the value of the U.S.
dollar against the functional currencies used by the Company's foreign
subsidiaries.
PROVISION FOR INCOME TAXES
The provision for income taxes as a percentage of income before the provision
for income taxes for the three and six months ended June 30, 1995 and June 30,
1994 was 42% and 39%, respectively. The provision for income taxes for the six
months ended June 30, 1995 and June 30, 1994 was 41% and 40%, respectively.
The percent increases in the provision for income taxes were primarily due to
merger and acquisition expenses that are not deductible for income tax
purposes.
LIQUIDITY AND CAPITAL RESOURCES
The Company's principal sources of operating funds have been from operations
and proceeds from sales of the Company's equity securities. The Company's cash
flow from operations for the six months ended June 30, 1995 and 1994 was
$8,229,000 and $4,461,000, respectively.
Management believes the Company's current working capital of $44,185,000 and
anticipated working capital to be generated by future operations will be
sufficient to support the Company's requirements for at least the next twelve
months.
The Company's uses of cash include purchases of property, plant and equipment
and repayment of long-term debt.
The Company intends to use its capital resources to expand its product lines
and for the acquisition of additional products and technologies.
The Company's subsidiaries in France carry $4.4 million in interest earning
deposits which may result in foreign exchange gains or losses due to the fact
that the functional currency in those subsidiaries is not the U.S. dollar.
At June 30, 1995, the Company had a credit agreement with a bank which provides
for advances totaling $850,000 consisting of a working capital line of $750,000
and a construction loan of $100,000. Advances under the working capital line
were based on a percentage of eligible accounts receivable, as defined.
Borrowings under the credit agreement are collateralized by receivables,
inventory and equipment, as defined. The $100,000 construction loan bears
interest at the bank prime rate plus 2% and the $750,000 line of credit bears
interest at the bank prime rate plus 1.5%. The prime rate at June 30, 1995 was
9%. The credit agreement expires on June 30, 1997. As of June 30, 1995,
$400,000 was borrowed under this credit agreement. The balance was paid off on
July 5, 1995. The line of credit expired as of June 30, 1995, and has not been
renewed.
11
<PAGE> 12
PART II OTHER INFORMATION
ITEM 6 Exhibits and Reports on Form 8-K
(a) Exhibits
27 Financial Data Schedule.
(b) Reports on Form 8-K.
None
12
<PAGE> 13
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereto duly authorized.
Dated: July 25, 1995
RAINBOW TECHNOLOGIES, INC.
By: /s/ PATRICK FEVERY
Patrick Fevery
Chief Financial Officer
13
<TABLE> <S> <C>
<ARTICLE> 5
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> MAR-01-1995
<PERIOD-END> JUN-30-1995
<EXCHANGE-RATE> 1
<CASH> 22,709
<SECURITIES> 7,880
<RECEIVABLES> 10,469
<ALLOWANCES> 342
<INVENTORY> 1,972
<CURRENT-ASSETS> 50,687
<PP&E> 14,631
<DEPRECIATION> 3,654
<TOTAL-ASSETS> 72,060
<CURRENT-LIABILITIES> 6,502
<BONDS> 2,809
<COMMON> 7
0
0
<OTHER-SE> 60,405
<TOTAL-LIABILITY-AND-EQUITY> 60,412
<SALES> 10,570
<TOTAL-REVENUES> 16,661
<CGS> 3,096
<TOTAL-COSTS> 13,067
<OTHER-EXPENSES> 97
<LOSS-PROVISION> 12,000
<INTEREST-EXPENSE> 104
<INCOME-PRETAX> 3,913
<INCOME-TAX> 1,656
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,656
<EPS-PRIMARY> .30
<EPS-DILUTED> .30
</TABLE>
